EuroWire January 2015

Transatlantic cable

Finally, the Conference Board, a non-pro t global research group with a membership of 1,200 reporting corporations and organisations, said that its index of leading economic indicators increased 0.9 per cent in October after a 0.7 per cent rise in September. The October reading was the best monthly showing since a 1.2 per cent jump in July. “The upward trend in the Leading Economic Index points to continued economic growth into early 2015,” said Conference Board economist Ken Goldstein. † Last but not least is an encouraging Labor Department report that core in ation, which excludes the volatile energy and food sectors, rose only 0.2 per cent in October. For the previous 12 months, overall in ation was up 1.7 per cent while core in ation was up a similarly modest 1.8 per cent. Both gains are well below the Federal Reserve’s two per cent in ation target, giving the central bank leeway to keep interest rates low to bolster the economy without any worries about in ation. † As noted by Mr Goldstein and others, the bugbears of slow business investment and lacklustre income growth continue to shadow the US economy. But they would appear to be the sole dark spots in an otherwise brightening picture. Although it does not increase the number of high-tech immigration visas, an executive order issued by President Barack Obama on 20 th November will allow spouses of the visa holders to seek and accept jobs of their own, a right denied them under current policy. The H-1B visa programme admits an estimated 140,000 workers in ‘speciality occupations’ annually. Their spouses come to the US under the separate H-4 visa programme. As noted by Sean Higgins of the Washington Examiner , immigration policy experts say that a majority of the spouses themselves hold high-tech degrees (many met and married while in school) and will likely seek work in industry under the liberalised rules. Thus, wrote Mr Higgins (20 th November), “While the policy change will not increase the total number of high-tech visas allowed, which is set by Congress, it will likely signi cantly expand the number of those workers allowed into the country. The spouses will not count as using H-1B visas.” Another change to the regulations will free a high-tech visa holder from ties to a speci c employer, a situation that according to critics of current policy makes an ‘indentured servant’ of the worker. The newly portable visa will enable the holder to move from job to job. Even so, Mr Higgins thinks business groups are likely to be disappointed by the presidential order. “[It has] a lot of small changes that business was asking for,” said one of his sources. “But apparently nothing huge.” Dorothy Fabian – USA Editor Immigration reform Spouses of high-tech immigrant visa holders will now be permitted to work in the US

† Solar is creating jobs. Solar industry jobs have increased 50 per cent in the US since 2010. Solar workers now outnumber coal miners nearly two-to-one. (Source: IEA) † The cost of installing solar panels in a typical (6 kW) house has dropped nearly 70 per cent (from $90,000 to $10,000) since 1998. (Source: National Renewable Energy Laboratory) † Solar economics are improving. The average cost of solar panels per watt has dropped from $75 in 1972 to less than $1 today. The estimated cost of a Chinese-made solar panel in 2015 is 42 cents. (Source: Greenpeace) † With solar power in the sunny US Southwest already at “grid parity” – meaning it costs the same as or less than electricity from conventional sources – Mother Jones noted that even Wall Street has begun to take notice. Venture capital funding for solar energy rose from $127 million in the rst quarter of 2013 to $251 million in the rst quarter of 2014. Of related interest . . . † Installed photovoltaic capacity worldwide ranges from below ve gigawatts (GW) in the United Kingdom, to 12GW in the US, to 35GW-plus in Germany, the global leader. (Source: International Energy Agency [IEA]) On the cusp of the New Year, encouraging indications are almost everywhere – and in ation is still a non-starter Reports late in the old year furnished evidence of a consistent, predictable, steady economy, with strong growth in the number of people working. Housing sales were rising, applications for unemployment bene ts declining, manufacturing in the mid-Atlantic states gaining strength – and an index designed to forecast growth moved higher. On 20 th November, the National Association of Realtors said sales of used homes rose 1.5 per cent to a seasonally adjusted annual rate of 5.26 million in October – up from a revised pace of 5.18 million in September. October was the rst month in 2014 when sales registered an increase compared with the year before, for a 2.5 per cent gain over October 2013. Median home prices nationwide in October rose 5.5 per cent over the previous 12 months to $208,300. The Labor Department said that the number of people applying for unemployment bene ts declined slightly in the previous week of 10 th November, suggesting that job gains should remain solid. Weekly applications for jobless aid fell 2,000 to a seasonally adjusted 291,000. The four-week average, a less volatile measure, rose 1,750 to 287,500. Also, the Federal Reserve Bank of Philadelphia said its index of regional factory activity jumped to 40.8 in November from 20.7 in October, reaching its highest level since December 1993. The report reinforced other indications that manufacturing is expanding modestly and helping to lift economic growth. A measure of new orders soared and more businesses in the Philadelphia area said they were adding jobs. The US economy

27

www.read-eurowire.com

January 2015